As the United States approaches its 250th anniversary, a significant shift is underway in the nation’s economic landscape. Chief Executive’s annual CEO survey of the Best & Worst States for Business reveals a dynamic reordering, with states that are proactively adapting to seismic demographic, technological, and economic transformations solidifying their competitive advantages, while others risk falling behind. The survey, based on hundreds of CEO responses, highlights a growing emphasis on fundamental strengths over short-term incentives, signaling a maturing approach to economic development.
This year’s findings underscore a critical realization among business leaders: enduring success is not built on fleeting deals, but on the sustained cultivation of core competencies. The data indicates a clear trend where states investing in robust infrastructure, a highly skilled workforce, and predictable regulatory environments are consistently outperforming those that lag in these foundational areas. The narrative emerging from the survey is one of strategic foresight and operational excellence, painting a picture of states that are not merely attracting business, but actively fostering environments where innovation and growth can thrive for the long term.
The Shifting Tides of Economic Power
The landscape of American business is in constant flux, and the past few years have accelerated this evolution. Demographic changes, driven by both domestic migration patterns and an aging population, are reshaping labor markets and consumer bases. Technological advancements, particularly in artificial intelligence, automation, and renewable energy, are creating new industries and demanding new skill sets. Economically, the nation is navigating global supply chain complexities, inflationary pressures, and the imperative for sustainable growth.
Against this backdrop, Chief Executive’s 2026 Best & Worst States for Business survey, an annual benchmark for corporate location decisions, offers a compelling snapshot of which states are successfully translating these broad shifts into tangible competitive advantages. The survey’s methodology, which aggregates the direct feedback of chief executives, provides a ground-level perspective on the factors most critical to business success.
Top Performers Demonstrate Foundational Strength
The perennial leaders in the survey, Texas and Florida, once again secured the top two positions, underscoring their continued appeal to businesses. They are joined in the top five by Tennessee, North Carolina, and Georgia, forming a robust Southern corridor that has consistently attracted investment. However, the real story lies in the significant upward mobility observed below this elite tier, indicating a more fluid and competitive national market.
South Carolina, for instance, made a dramatic leap of seven spots to claim the sixth position. This surge is directly attributed to its proactive efforts in building essential infrastructure and talent pipelines, exemplified by Google’s substantial investment. In 2007, Google quietly established a data center in Moncks Corner, South Carolina. Nearly two decades and $4.5 billion later, the tech giant has committed an additional $9 billion through 2027. This expansion is not merely about increased capacity; it signifies Google’s deep integration of South Carolina into its global AI infrastructure network. Ruth Porat, Alphabet and Google’s president and chief investment officer, articulated the company’s long-term vision, stating that this investment builds on a 15-year foundation to secure South Carolina’s success "during the next wave of American innovation."
This headline-grabbing investment is a testament to years of less visible, yet crucial, groundwork. South Carolina’s success hinges on its commitment to fundamental necessities: reliable power, a skilled and adaptable workforce, robust transportation networks, readily available development sites, and an efficient permitting process. This "build-the-basics" narrative is echoing across the country.
Ohio, another significant climber, jumped five places to seventh, becoming the highest-ranked Midwestern state. Its strategic approach involves assembling a diverse portfolio of investments, including major projects from Intel, Joby Aviation, and Anduril. Ohio’s success is propelled by aggressive, targeted marketing, compelling storytelling about its economic future, and a sustained focus on upskilling its existing workforce. This dual approach of attracting new industries while nurturing current talent has proven to be a winning formula.
Mid-Pack Momentum and Structural Shifts
Beyond the top performers, quieter but equally significant shifts are occurring in the middle of the pack. States like Wyoming, Wisconsin, and Missouri each climbed four spots this year, with Wisconsin building on a remarkable nine-place jump from the previous year. This sustained momentum suggests a structural improvement in Wisconsin’s business climate, rather than statistical anomaly.
Pennsylvania’s rise of five places to 26th illustrates how consistent performance on foundational elements can reshape CEO perceptions over time. As site selection expert Larry Gigerich, executive managing director of Ginovus consultants, notes, "The states focusing on the fundamentals—talent, infrastructure, tax and regulatory climate—are the ones that will continue to do well."
Global futurist Jim Carroll offers a stark perspective, suggesting that some states remain "in denial about the reality of where the future is going." He posits that future economic dominance will belong to those states that proactively build the conditions for investment—fostering serious research and development, embracing modern grid technology, establishing genuine alignment between business and academia, nurturing robust incubators, and implementing continuous skills training programs.
The Unseen Force: Migration Reshaping the Economic Map
Perhaps the most potent force reshaping the long-term business landscape is not a specific tax policy or incentive package, but the simple, yet profound, movement of people. Recent Census estimates reveal that South Carolina’s population grew by 1.5 percent between July 2024 and July 2025, outpacing every other state and nearly tripling the national growth rate. This marks its second consecutive year as the nation’s growth leader.
Dr. Joseph Von Nessen, a research economist at the University of South Carolina’s Darla Moore School of Business, terms this population growth the state’s "secret sauce." He argues that in-migration injects not only consumers but also a vital supply of workers and taxpayers, simultaneously accelerating demand for housing, healthcare, and services, which in turn supports a broader array of industries.
However, Von Nessen emphasizes a crucial nuance: the quality of migration matters more than headline growth figures. A state attracting young engineers and entrepreneurs will experience a vastly different economic trajectory than one primarily fueled by retirees. This distinction impacts labor supply, wage pressures, and long-term economic dynamism.
Natasha August, founder of Dallas-based creator platform RM11, attests to this. Texas is drawing the working-age talent her company requires at price points that facilitate both hiring and retention. "Everything around Dallas and in Texas in general is just more reasonable to live here," August states. "Thus, the employee retention is a lot higher for us." This affordability, coupled with a growing talent pool, makes Texas a highly attractive hub for businesses focused on scalable growth.
Midwest Resilience and Emerging Success Stories
While the Sunbelt continues to capture headlines, the economic strengths of the Midwest are increasingly being recognized. Sean Donegan, CEO of AI-driven geospatial analytics firm Satelytics, based in Perrysburg, Ohio, expresses frustration with the perception that innovation is confined to the coasts. "I’m tired of people believing that the only software companies that exist are on the West and East Coasts—and that’s just completely untrue," Donegan asserts. "The Midwest is greatly undervalued. People here are incredibly smart, loyal, trustworthy, and honest—key attributes for any successful business."
Michigan, after decades of economic challenges, is showing clear signs of a rebound. The state has recorded four consecutive years of population gains and its first net in-migration in 35 years, signaling a renewed appeal to both companies and families. Although Michigan slipped seven places to 24th in this year’s ranking, this is seen less as a decline and more as a transition. The state is actively working to diversify its economy beyond its traditional automotive base, focusing on technology and life sciences to build "recession-resilient" sectors without abandoning its core industry. Michelle Grinnell of the Michigan Economic Development Corporation highlights the state’s "Team Michigan" approach, emphasizing concierge-style coordination across agencies, early permitting engagement, and precise matching of projects to communities and sites, ensuring a streamlined and predictable experience for businesses.
Talent and Education: The Cornerstones of Future Capacity
In the contemporary economic environment, the availability and quality of human capital have become paramount. States that are excelling are treating talent not as a static asset, but as a dynamic operating system—actively recruiting, training, matching, retaining, and continuously upgrading skills to align with evolving industries.
Steven Boal, founder of Matia Mobility, relocated his company from the Bay Area to Salt Lake City, Utah, citing the prohibitive logistics of manufacturing on the West Coast. "Utah’s greatest asset is its demographics," Boal explains. "The brain drain has reversed. We are seeing more talent stay in Utah post-graduation, and more experienced leaders moving here for the quality of life, which helps us tackle the pipeline challenge from both ends." Proximity to research institutions like the University of Utah and Brigham Young University further enhances Utah’s appeal, as these universities are actively commercializing technology and fostering an entrepreneurial spirit within their engineering programs.
South Carolina has meticulously constructed a workforce development system centered on scale and speed. Its network of technical colleges, coupled with programs like readySC and Apprenticeship Carolina, are recognized as "best-in-class examples of what workforce development can and should look like," according to Commerce Secretary Harry Lightsey. With nearly 2.5 million South Carolinians employed and a working-age participation rate exceeding 82 percent, these figures reflect decades of strategic alignment between educational institutions and employers.
Ohio’s approach to talent development emphasizes customization. J.P. Nauseef, CEO of JobsOhio, points to deep STEM pipelines and community colleges that develop bespoke programs tailored to employers’ long-term forecasts. Crucially, Ohio invests in upskilling the existing adult workforce, not just new graduates. "If we don’t have the talent, we’ll develop a program to certify the type of talent they need with one of the many community colleges and four-year degree-granting institutions and job centers," Nauseef states. This proactive strategy has been instrumental in attracting capital-intensive projects, including Intel’s multibillion-dollar chip fabs and the Honda-LG EV power-systems complex.
For CEOs, the critical question is evolving from "Can I find workers here?" to "Can this state consistently produce and retain the diverse skill sets I will need as AI, automation, and new energy systems transform my industry?" The answer increasingly hinges on the strength of the linkage between business and education, and the agility of this combined system to adapt to technological waves.
Energy Infrastructure: A Non-Negotiable for Investment
In the current climate, reliable and abundant energy is no longer a secondary consideration but a primary, non-negotiable factor in site selection. Data centers, electric vehicle supply chains, and high-intensity manufacturing operations demand a level of power certainty that dictates early-stage due diligence. CEOs are prioritizing the question: "Can the site reliably power the operation, every hour of every day?" before exploring incentives, labor availability, or construction timelines.
North American Iron’s decision to establish a multibillion-dollar, low-emissions pig iron facility in Minot, North Dakota, bypassing traditional steel-producing states, exemplifies how energy considerations can dramatically reshape the economic map. CEO Jim Bougalis highlights a unique combination of factors: abundant and cost-competitive natural gas, a grid engineered for 24/7 reliability, and a carbon-storage framework he describes as "unmatched in North America."
"North Dakota spent more than a decade putting rules in place so companies can safely store captured CO2 underground under a clear, state-run permitting process," Bougalis explains. He emphasizes that "energy certainty" is paramount, closely followed by regulatory clarity. "Companies don’t need fast or loose; they need predictable. North Dakota’s consistency and transparency in permitting allowed us to make long-term commitments with confidence."
Ohio has similarly focused on streamlining energy-related processes. House Bill 15 aims to compress energy-project permitting timelines, while designated energy-infrastructure zones and behind-the-meter rules offer large industrial users greater flexibility. A $100 million initiative is also designed to unlock more of the state’s natural gas resources for industrial customers. J.P. Nauseef of JobsOhio articulates the goal clearly: "Power should never be the reason a project dies in Ohio. We have programs to get power there quickly."
South Carolina offers a distinct energy advantage with its nuclear-dominant grid, which generates over half of its electricity from reactors. This provides the consistent baseload power essential for data centers and advanced manufacturing. Grid hardware manufacturer Eaton, recognizing this strength, invested $340 million last year to build a third U.S. manufacturing facility for three-phase transformers, contributing to over $1 billion in state investments since 2023.
For some manufacturers, the focus extends to on-site power generation. Nathan Silvernail, CEO of climate-tech manufacturer Plantd, which converts waste biomass into carbon-negative building materials, generates its own power through gasification and is adding solar capacity. He chose rural Oxford, North Carolina, partly due to a less burdensome permitting process and fewer punitive tariffs. "A state that makes it easy to feed excess power back to the grid or offset industrial consumption with on-site generation changes our operating economics significantly," Silvernail notes, highlighting that industrial power rates in rural areas can lag when utilities haven’t invested proactively.
The consistent takeaway for CEOs is to treat the energy briefing as a foundational element, not an afterthought. Questions about grid capacity, timelines, reliability, behind-the-meter options, interconnection processes, nuclear posture, and carbon strategy are now central to investment decisions.
Grid Expansion and Infrastructure Modernization
The definition of "infrastructure" has expanded beyond roads and bridges to encompass throughput and time-efficiency. This includes port capacity, rail connections, broadband accessibility, and truly shovel-ready sites. The fundamental operational question for CEOs is: "Can my inputs arrive and my product leave at the speed my business requires?"
Arizona serves as a real-time case study of growth outpacing supporting systems. Last year, the state saw a dip in rankings as population growth and investment strained its grid and built environment. In response, regulators and utilities have accelerated efforts, approving nearly 5,000 megawatts of new generation and storage, initiating multibillion-dollar grid expansion plans, and directing new funding for resilience upgrades benefiting 1.6 million customers. "As Arizona continues to grow, we must ensure the power grid keeps pace to meet the growing energy demands of the future," states Nick Myers, chair of the Arizona Corporation Commission. "Every megawatt and mile of transmission approved by the Commission represent more than growth and economic development—they represent a more reliable and resilient grid and a commitment to long-term energy security for families and businesses across the state."
This focus on infrastructure is evident beyond energy. ADOT has commenced a $410 million widening of I-10 between Phoenix and Casa Grande, a critical artery for freight movement. These tangible infrastructure improvements have helped Arizona climb two spots to eighth in the rankings.
However, infrastructure challenges are not uniform. Texas is confronting significant pressure on its water resources due to rapid growth. Site selection expert Larry Gigerich points out the state’s urgent need for a comprehensive water plan for the "next 50 years."
Ohio’s infrastructure advantage lies in preparedness. Years of work by port authorities and local partners have created one of the Midwest’s most extensive inventories of development-ready industrial sites, where utilities, zoning, and access are largely pre-cleared. For CEOs operating under tight deadlines, this proactive site development can be the decisive factor in project feasibility.
Speed is a recurring theme for founders. Nathan Silvernail of Plantd sought an ecosystem that could move swiftly: suitable land, efficient logistics for biomass transport, accessible industrial power, and a workforce capable of handling both physical manufacturing and advanced automation. "Innovation is moving to where you can build things, not where you can pitch things," Silvernail emphasizes. "Governors should understand that companies like ours aren’t looking for innovation districts—we’re looking for cheap industrial real estate, accessible electricity, ag land, and workforces that can handle both hard physical manufacturing and advanced automation."
This demand for ready infrastructure is also leading some startups to rediscover legacy industrial corridors. Food-tech startup Savor established its first 25,000-square-foot facility in Batavia, Illinois, by acquiring an existing fats-and-oils plant. "It was the exact kind of infrastructure our company needed," says co-founder and CEO Kathleen Alexander. The plant already possessed key permits, and local officials were supportive, allowing the team to focus on equipment upgrades rather than navigating a lengthy regulatory process. Illinois’ deep food-manufacturing ecosystem, encompassing talent, suppliers, and corporate headquarters, can offset higher labor costs.
Beyond Taxes: Defining a "Business-Friendly" Climate
The notion of a "business-friendly" state is evolving. While tax rates and incentives remain relevant, CEOs now interpret this term more literally: How quickly can I get a straight answer? How predictable is the process? And when issues arise with permitting, inspections, or utilities, does the state facilitate resolution or create additional hurdles?
In Utah, accessibility and speed are paramount. Regulators and economic development leaders are responsive, and permitting processes align with the market demands of regulated industries, not bureaucratic timelines.
Texas offers operational clarity at scale. Danny Sit, CEO of mobile phone maker NUU, describes the company’s move from California to Irving as a "strategic move that helped set the foundation for our growth." He highlights Texas’ combination of pro-business policies, a deep and expanding workforce, and operating costs that allow companies to "stay lean while investing more into innovation and customer experience." Irving’s location within the Dallas-Fort Worth metroplex provides central access to distribution networks, robust infrastructure, and proximity to key partners and customers.
Florida’s advantage, according to several founders, lies in the day-to-day operational experience. Victor Ragone, founder of Sgt. Rags Beef Jerky, contrasts his Florida experience with previous ones in Oregon and California, describing "less red tape, fewer hoops, and people [who] actually want to help you get things done." This efficiency allows for greater focus on product development and distribution.
Thomas Aronica, founder and CEO of Biller Genie, champions Orlando, Florida, as a city that is "big enough to recruit and scale, but not so expensive or noisy that it pressures you into bad hiring and bloated burn." He notes the presence of STEM-heavy universities, a growing tech ecosystem, and a lower cost base compared to Miami, making internships, recruiting, and retention more "actionable than in many ‘brand-name’ hubs." Orlando’s airport offers direct routes that facilitate go-to-market strategies without excessive travel burdens.
South Carolina has explicitly branded its operational style as being a "handshake state." Commerce Secretary Harry Lightsey attributes this to a shared pro-business mindset and coordination "at all levels—local, regional, and state," enabling swift decision-making and dependable commitments. For CEOs considering long-term investments, this reputation can be as valuable as any incentive package.
Ohio’s JobsOhio model institutionalizes this principle of streamlined engagement. It serves as a single point of contact, navigating the state’s home-rule complexities to ensure companies do not have to manage them alone. Deals are structured around core constraints—power, water, sites, buildings, talent, and timing—with incentives designed for rapid payback, averaging under two years through payroll taxes. The gap between states that operate with this level of ease and those that do not is projected to widen significantly over the next two decades. As Kathleen Alexander of Savor observes, CEOs should seek states that already possess the necessary ecosystem and are actively working to remove barriers. "Bureaucracy kills or significantly hampers innovation," she states, urging states to "pair their regional strengths with a regulatory environment that moves at the speed of innovation. Do those two things—leverage what’s already there and clear the red tape—and they’ll win the industries that define the next century."
